Immediate Effects from New Act
Bill SB651, SD2, HD2, CD1 was signed as Act 48, and was intended to have an impact right away. The law applies to non-judicial forclosures and is administrated by the Department of Commerce and Consumer Affairs.
This act created several changes to the non-judicial forclosure procedures in Hawaii. One of the creations of Act 48 is the Mortgage Foreclosure Dispute Resolution Program. This program allows owner-occupants of residential property to meet with their lenders' representative to work on modifying the loan and work out a payment plan within the timeframe of 3 months. This program is limited to owner-occupants who have resided at a residential property for no less than 200 consecutive days. The program took effect on October 1, 2011 and will run through September 30, 2014.
However, due to apparent problems with this new law, most lenders are avoiding non-judicial foreclosures, rendering the new law moot.
HB 754 Relating to Taxation
The bil, signed into act 06/14/2011 suspends for two years (from July 1, 2011 to June 30, 2013) the general excise and use tax exemptions for certain persons and business activities. During the two-year suspension period, the formerly exempt persons and business activities will be subject to the four per cent general excise or use tax rate (but not the 0.5 per cent surcharge in Honolulu for the rail project).
This bill promotes fairness by suspending tax exemptions from business who previously had them and requires everyone to follow the same taxation laws. By removing such exemptions Hawaii projects to regain a large portion of the budget gap. SB 754 generates, for the general fund, $173.2 million in fiscal year 2011-12 and $220.3 million in fiscal year 2012-13.
Thus by suspending these tax exemptions and regaining a large amount of revenue, it removes the need for a general increase in taxes.
This blog is for educational purposes only and cannot be relied upon as legal, tax, or any professional advice.
A Bill for an Act. HB 924
Legislative Update
Act 83 ("Act") was signed into law in June and will become effective July 1, 2012. The Act abrogates The Intermediate Court of Appeals of Hawai`i's May 19, 2010 decision in Group Builders, Inc. v. Tradewind Ins. Co., Ltd., in which the court held that construction defect claims do not constitute "occurrences" under contractor's commercial general liability policies, and therefore those policies do not cover claims for property damage or bodily injury arising from construction defects. The absence of such coverage exposed contractors facing a single large claim to the risk of financial ruin, but the Act will require insurers to extend coverage to construction defects claims in commercial general liability policies issued or renewed on or after July 12, 2012. A copy of the Act can be found here as a pdf file for your records and review.
If you have any questions about how the Act will affect your business or other issues involving construction law, please do not hesitate to call me at your convenience so we can discuss them.
This blog is for educational purposes only and cannot be relied upon as legal, tax, or any professional advice.